Financial year

Last updated: 2021-06-22

The financial year corresponds to the period for which a company must make its financial statements or draw up its annual report. The financial year is therefore important for the company’s taxation.

Normally, a financial year should be 12 months. In some exceptional cases, the fiscal year may be longer or shorter than 12 months, for example during the first year or if the fiscal year is to be rescheduled. When the business is to be shut down, the last financial year may be shorter than 12 months, but never longer.

Some companies apply the calendar year as their accounting year, but it is also possible to apply to the Tax Agency to have a different period as their accounting year. When you have a financial year other than the calendar year, it is called a broken financial year.

Example of fiscal year

• Calendar year: 1 Jan - 31 Dec
• Broken financial year: 1 Oct - 30 Sep